The World Bank Report No: ISR12256 Implementation Status & Results Djibouti Djibouti Power Access and Diversification Project (P086379) Public Disclosure Copy Operation Name: Djibouti Power Access and Diversification Project (P086379) Project Stage: Implementation Seq.No: 20 Status: ARCHIVED Archive Date: 29-Dec-2013 Country: Djibouti Approval FY: 2006 Product Line: IBRD/IDA Region: MIDDLE EAST AND NORTH AFRICA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 01-Nov-2005 Original Closing Date 31-Dec-2009 Planned Mid Term Review Date Last Archived ISR Date 06-Jul-2013 Effectiveness Date 29-Mar-2006 Revised Closing Date 31-Mar-2014 Actual Mid Term Review Date Project Development Objectives Project Development Objective (from Project Appraisal Document) The revised project development objectives are: (i) To increase access of underserved populations to electricity services; (ii) To improve EDD’s efficiency through execution of investment operations aimed at reducing EDD’s electricity losses, and; (iii) To reduce the negative effects of drought on water pumping in both rural and urban areas by strengthening the country’s power supply resilience to natural catastrophes, through the creation of High Fuel Oil (HFO) and diesel security stocks. Has the Project Development Objective been changed since Board Approval of the Project? ● Yes No Component(s) Component Name Component Cost IDA CR 41200 - Electricity Distribution Expansion to Balbala 1.10 IDA CR 41200 - Technical Assistance through three studies 0.50 IDA CR 41200 - PMU capacity strengthening 0.50 IDA CR 41200 - Emergency Assistance for Fuel Purchase to EDD 4.30 IDA GRANT H5740 - Further Expansion of Electricity Access 1.90 Public Disclosure Copy IDA GRANT H5740 - Deployment of Loss Reduction Investments 3.80 IDA GRANT H5740- Implementation Support 0.30 IDA GRANT H8730 - Institutionalizing the Management of Petroleum Security Stocks 0.40 IDA GRANT H8730 - Setting up of petroleum security stocks 4.80 Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Satisfactory Page 1 of 7 The World Bank Report No: ISR12256 Previous Rating Current Rating Overall Risk Rating Substantial Substantial Public Disclosure Copy Implementation Status Overview The execution and the disbursement of the project activities planned under the first additional financing are finally moving forward. The smart metering pilot project is now progressing at a very good pace and is likely to be completed before the closing date of the project, scheduled for March 31, 2014. However, the project implementation schedule leaves no buffer time, while pilots are innovative projects that carry greater risks than core business projects. Moreover, custom clearance is a particularly lengthy process in Djibouti, which adds risk to finalize the activity after project closing date. Since the last ISR, the execution of the distribution network activities is also satisfactory. However, the works had to stop for a couple of months due to the need to perform a geolocation audit on the excavations done by the sub-contractor, who did not properly follow the protocol designed by the contractor to set the locations of the power poles. The findings of this audit revealed that two third of the works needed to be done again, which caused additional delays. Another challenge that the client faced while executing the project stemmed from the need to comply with our social safeguards, which require that works financed by the Bank have no negative social impact as described in Social Safeguard Operational Policy 4.12. Works resumed after the completion of the audit, and are now done at a very fast pace. Yet, it is apparent that the rehabilitation and extension of the network in the areas of Arta and Balbala cannot be finalized before July 31, 2014; i.e. four months after the scheduled closing date. Delays in the execution and the disbursement of the project activities planned under the second additional financing are accumulating since board presentation in June 2012 and little progress has been recorded since the last ISR. The recruitment of the consultant in charge of developing the regulation of the petroleum security stocks took eighteen months to be completed. However, the work is now finally starting and is expected to be completed before the project closing date. The recruitment of the petroleum expert expected to help the project implementation unit procure the petroleum products and negotiate their storage in line with World Bank rules proved to be very difficult. On the one hand, it is apparent that experts with a record of successful experience in petroleum trading have little interest in small transactions, such as the one financed under this project and the bank team had to help the client identify potential applicants. On the other hand, insufficient effort was done by the beneficiary to secure the availability of the few experts who expressed interest in the assignment. As a result the recruitment of the expert is still not finalized. Yet it is a critical path activity. The procurement of the petroleum products can only be done before the end of the project closing date, if the recruitment is finalized by December 20th, 2013. The abnormally long delays recorded in the execution of the activities supported by the second additional financing demonstrate the lack of Government of Djibouti’s willingness to see the project completed in the way it was designed. Discussions with the authorities revealed the existence of a preference for the immediate consumption of petroleum products rather than the set-up of HFO/ diesel security stocks. The World Bank implementation team reminded the Authorities that the additional financing was specifically provided by IDA’s emergency crisis response window to help Djibouti manage risks associated with drought through the constitution of petroleum security stocks and their regulation. The funds cannot be used to finance an emergency consumption of petroleum products, which has no development impact at all. Locations Country First Administrative Division Location Planned Actual Djibouti Region d' Obock Obock Djibouti Ville de Djibouti Djibouti Public Disclosure Copy Djibouti Region de Dikhil Dikhil Djibouti Region d' Arta `Arta Djibouti Region d' Ali Sabieh Region d' Ali Sabieh Djibouti Ville de Djibouti Balbala Djibouti Ville de Djibouti Balbala Page 2 of 7 The World Bank Report No: ISR12256 Results Project Development Objective Indicators Public Disclosure Copy Indicator Name Core Unit of Measure Baseline Current End Target Days of HFO purchased, stored and Days Value 0.00 0.00 5.00 maintained Date 23-May-2012 30-Sep-2013 31-Mar-2014 Comments 5 days of HFO purchased, stored and maintained. Days of Diesel purchased, stored and Days Value 0.00 0.00 5.20 maintained Date 23-May-2012 30-Sep-2013 31-Mar-2014 Comments 5.2 days of Diesel purchased, stored and maintained. New security stocks regulation designed and Text Value No regulation No regulation Regulation is designed and implemented implemented Date 23-May-2012 30-Sep-2013 31-Mar-2014 Comments Direct project beneficiaries Number Value 0.00 468000.00 468000.00 Date 11-Oct-2005 30-Sep-2013 31-Mar-2014 Comments The project comprises a The project comprises a parent project and two parent project and two additional financings. The additional financings, with parent project includes a multiple components targeting Heavy Fuel Oil (HFO) different populations. TheHFO purchase component that purchase component of the allowed the electricity utility to parent project has the largest avoid a discontinuation of its number of beneficiaries, as its supply of electricity to the implementation benefited the population in Djibouti city in populationof all of Djibouti 2009. The population of City. The total number of Djibouti City makes up 57% of beneficiaries of the project is Public Disclosure Copy the total population of the therefore 468,000. This country, which amounted to number has been reached in 822000 people in 2009. The 2009with the completion of HFO purchase component the HFO purchase was successfully completed in component. 2009 and the number of beneficiaries of the project is therefore 468000 since 2009, i.e. 57% of the total population which lives in Page 3 of 7 The World Bank Report No: ISR12256 Djibouti City and is connected to the grid. Female beneficiaries Percentage Value 0.00 49.30 49.30 Public Disclosure Copy Sub Type Supplemental Number of additional connections, improved Number Value 0.00 0.00 3800.00 connections, reconnections established in Date 10-Nov-2005 30-Sep-2013 31-Mar-2014 Balbala project site Comments The number of connections will not be available before the end of the project People provided with access to electricity by Number Value 0.00 0.00 22800.00 household connections Date 11-Oct-2005 30-Sep-2013 31-Mar-2014 Comments The number of people Target is 3,800 households, 6 provided with electricity will people per household, total of not be available before the 22800 people end of the project People provided with access to electricity by Number Value 0.00 0.00 22800.00 hhold connections-Grid Sub Type Date 11-Oct-2005 30-Sep-2013 31-Mar-2014 Breakdown Comments Number of new street lighting units Number Value 199.00 219.00 442.00 Date 10-Nov-2005 30-Sep-2013 31-Mar-2014 Comments 20 units installed. 442 units = 199 units of the 221 units remaining. baseline + 241 new units. Reduction in electricity losses as a % of total Percentage Value 12.00 3.00 billed in selected 20 kV feeder due to the Date 10-Nov-2005 30-Sep-2013 31-Mar-2014 deployment of smart meters Comments Intermediate Results Indicators Public Disclosure Copy Indicator Name Core Unit of Measure Baseline Current End Target Transmission lines constructed or rehabilitated Kilometers Value 0.00 0.00 33.64 under the project Date 01-May-2010 30-Sep-2013 31-Mar-2014 Comments Transmission lines constructed under the Kilometers Value 0.00 0.00 33.64 project Sub Type Date 01-May-2010 30-Sep-2013 31-Mar-2014 Breakdown Comments Page 4 of 7 The World Bank Report No: ISR12256 Completion of 1.85 km of 20 kV primary lines; Text Value 0 new primary lines, 0 new MV : 0 km 1.85 km of primary lines; completion of 12.35km of 400/200 V secondary secondary lines, 0 new LV : 0 km 12.35km of secondary lines; lines; installation of 3x400kVA and 3x800kVA transformers 3x400kVA transf. : installed 3x400kVA and 3x800kVA transformers (20kV/400/200 V) 3x800kVA transf. : installed transformers Public Disclosure Copy Date 10-Nov-2005 30-Sep-2013 31-Mar-2014 Comments Engineering, procurement and construction Text Value No contract signed Bid launched, contract signed Bid launched, contract signed contract for Smart Meters signed and contract started and contract completed Date 27-Jul-2010 30-Sep-2013 31-Mar-2014 Comments Deployment of smart meters is on going Engineering, procurement and construction Text Value No contract signed Bid launched, contract signed Bid launched, contract signed contract for extension of Balbala distribution and contract started and contract completed network and extension of the 20 kV line toArta Date 27-Jul-2010 30-Sep-2013 31-Dec-2013 Comments Rate of progress on installation of 3341 smart Percentage Value 0.00 6.00 100.00 meters Date 27-Jul-2010 30-Sep-2013 31-Mar-2014 Comments The rate of progress has reached 20% in November 2013, for a total of 730 meters installed. The implementing agency is installing at a rate of around 50 meters a day. Primary lines, secondary lines, transformers Text Value 0 new primary lines, 0 new 0 km new primary lines, 0 km 1.85 km new primary lines, and street lighting installed secondary lines, 0 new new secondary lines, 12.35 km new secondary transformers, 199 street lights 6 new transformers installed, lines, 3x400kVA and3x800 20 street lights installed kVA transformers, 442 street lights Date 27-Jul-2010 30-Sep-2013 31-Mar-2014 Comments Public Disclosure Copy Contract signed for the project management Text Value No contract signed Contracts signed Contracts signed services and for the financial auditing services Date 27-Jul-2010 30-Sep-2013 27-Jul-2011 respectively Comments Recruitment of a consultant for the purchase of Text Value No contract signed No contract signed Petroleum security stocks HFO and Diesel and the negotiation of their stored and maintained storage and maintenance Date 23-May-2012 30-Sep-2013 31-Mar-2014 Comments Page 5 of 7 The World Bank Report No: ISR12256 Recruitment of a consultant for the draft of a Text Value No contract signed No contract signed Regulation is designed and security stocks regulation implemented Date 23-May-2012 30-Sep-2013 29-Mar-2014 Public Disclosure Copy Comments The consultant in charge of the draft of the regulation was recruited after the supervision mission ended. The contract was signed and a copy provided to the World Bank on December 07, 2013. The consultant has started its work. Data on Financial Performance (as of 01-Oct-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P086379 IDA-41200 Effective 01-Nov-2005 28-Nov-2005 29-Mar-2006 31-Dec-2009 31-Mar-2014 P086379 IDA-H5740 Effective 15-Jun-2010 27-Jul-2010 13-Apr-2011 30-Jun-2013 31-Mar-2014 P086379 IDA-H7830 Effective 12-Jun-2012 21-Aug-2012 16-Jan-2013 31-Mar-2014 31-Mar-2014 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P086379 IDA-41200 Effective XDR 4.70 4.70 0.00 4.68 0.02 100.00 P086379 IDA-H5740 Effective XDR 4.00 4.00 0.00 1.89 2.11 47.00 P086379 IDA-H7830 Effective XDR 3.40 3.40 0.00 0.35 3.05 10.00 Disbursement Graph Public Disclosure Copy Page 6 of 7 The World Bank Report No: ISR12256 Public Disclosure Copy Key Decisions Regarding Implementation All the activities financed by the power access and diversification project cannot be finalized by March 31, 2014. The World Bank is contemplating the need for a closing date extension for the project activities that will be fully committed by December 31, 2013. Such extension would enable Government of Djibouti to benefit from the full developmental impact of the smart metering pilot project, and the rehabilitation and extension of the power grid in the areas of Balbala and Arta but not necessarily from the set-up of security stocks for power generation. The Government of Djibouti must decide whether the set-up of petroleum security stocks remains a priority for the country and if it is willing to use the IDA CRW grant to purchase these stocks in line with the World Bank group fiduciary rules. If so, drastic efforts should be made to recruit the petroleum expert by December 20th and jump-start the petroleum procurement to avoid a cancellation of the largest part of the IDA CRW grant. Restructuring History There has been no restructuring to date., CD Decision on 23-Jan-2010, Level two Approved on 23-Jun-2010, Level two Approved on 30-Dec-2010, Level two Approved on 09- May-2012, Level 2 CD Decision on 16-Oct-2013 Public Disclosure Copy Related Projects P112253-DJ- Power Access and Diversification, Additonal Financing, P130493-DJ- Power Access and Diversification Project Additional Financing II Page 7 of 7